CAIRO: The Ministry of Petroleum will implement a program to increase productivity and efficiency of oil refineries, with total investments worth $1.5 billion, amid efforts to meet growing domestic consumption, according to a Friday statement.
New production units will be established to meet the increasing demand on petroleum products, especially petrol, diesel and butane gas, Minister of Petroleum Sherif Ismail said in the statement.
“The petroleum sector is intensifying efforts to provide local supplies and reduce imports, so as to rationalize fuel subsidies,” said Ismail. Each ton of fuel carries a government subsidy of 3,000 EGP (U.S. $447), which is a heavy burden on the state budget, according data from the ministry.
Egypt is suffering from a major energy crisis due to a significant fuel shortage, which has led to daily power cuts nationwide and has dramatically harmed the industrial sector.
Cement plants have urged the government to allow for coal use amid growing fuel shortages, despite concerns over the environmental damages coal may cause. Earlier this month, the Cabinet approved the use of coal as long as it abides by environmental standards, and increased penalties for those who violate regulations.
Head of Egyptian Natural Gas Holding Company (EGAS) Khaled Abdel Badie told Youm7 Friday that gas supplies for the industrial sector were limitedly reduced to provide fuel for power plants to overcome the current energy crisis.
“The petroleum sector is giving priority to providing energy for power plants, followed by fertilizer plants, then other industries,” said Abdel Badie.
Meanwhile, Minister of Industry and Trade Mounir Fakhry Abdel Nour has defended using coal on the sidelines of launching the first phase of a joint Egyptian-Emirati projects on Thursday, according to media reports.
Abdel Nour further noted that “using coal in the industry to generate energy has become inevitable in the current period, however, the government is currently setting in place European standards and requirements for using coal in factories,” Youm7 reported Thursday.
The industry is facing several challenges, most prominent among these is the energy shortage, which hinders the development of the sector, a result of which will cause unemployment to edge up, posing threats to society, added the minister.
Allowing coal to be used by factories as an energy source instead of natural gas is a controversial issue that has been debated between the Ministry of Environment and the Ministry of Electricity and Energy for the past few months, amid an increasing energy crisis and frequent blackouts.
The Ministry of Environment views the use of coal in factories as dangerous to the environment, and has said such a project would need years to be implemented safely in Egypt. But the Suez Cement Company and the Ministry of Electricity argued coal is the best alternative energy source at the moment.
Minister of Environment Laila Iskander said in March that using coal in factories is dangerous to the economy, tourism and people’s health, MENA reported.